Redundancy – Suitable Alternative Employment

05 June 2012

In a further case on whether or not it was reasonable for an employee at risk of redundancy to refuse an offer of suitable alternative employment, the Employment Appeal Tribunal (EAT) has reaffirmed that the test is a subjective one. In such cases, the Employment Tribunal (ET) must ask whether it was unreasonable for the particular employee to refuse the offer for the reasons they gave for doing so (Readman v Devon Primary Care Trust).

Mrs Readman began her career with the NHS in 1976. In 1985, she moved away from a hospital setting and worked in various capacities in Community Nursing, ultimately as a Community Modern Matron for Devon Primary Care Trust (PCT). Following a reorganisation in 2007, this job disappeared and Mrs Readman was at serious risk of redundancy. She was offered the option of three posts, two of which were at a lower grade. The third post, the position of Modern Matron at Teignmouth Hospital, involved no loss of status but Mrs Readman rejected it on the ground that she had not worked in a hospital setting since 1985 and her career path and qualifications were in Community Nursing. She subsequently accepted work in Canada. Devon PCT refused to give her a redundancy payment because it believed she had unreasonably rejected an offer of suitable alternative employment. Mrs Readman challenged this decision at the ET.

The ET held that whilst the first two posts on offer were not suitable, the offer of the position at Teignmouth Hospital was one of suitable alternative employment and it was unreasonable of Mrs Readman to refuse it. In the ET’s view, she had done so for her own reasons, particularly her desire to emigrate to Canada. Devon PCT was therefore entitled not to make a redundancy payment in her case. Mrs Readman appealed.

The EAT upheld her appeal and substituted a finding that she was entitled to receive a redundancy payment. Whilst it agreed with the ET’s finding that the Teignmouth post was the only one on offer that constituted suitable alternative employment, the EAT held that the ET had erred in law in failing to address the core reason why Mrs Readman had refused the offer. She had stated clearly that she had no desire to return to work in a hospital setting, yet the ET had failed to consider whether this was a sound and justifiable reason for her rejecting the post. The ET was clearly of the view that a reasonable employee would have accepted the offer and had ‘wholly failed to grapple with the question’ of whether it was unreasonable for this employee, for the reasons which she gave, to refuse that offer.

In the EAT’s judgment, in the particular circumstance of the case, the desire not to work in a hospital setting did provide Mrs Readman with a sound and justifiable reason for turning the offer down. That she may have had in the background a desire to go to Canada and might prefer to have the redundancy money were plainly incidental to the main reason for her refusal, which was clearly stated and repeated on several occasions.

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